India’s capex may hit US$ 800 billion by FY30

Indian corporates are expected to double capex to US$ 800 billion by FY30, supported by infrastructure growth, policy reforms, and strong balance sheets, with S&P Global Ratings noting this mirrors China’s 2000s expansion but under tighter financing conditions. Advanced research and development is expected to attract an additional US$ 1 trillion in investment.

India’s top corporates are set to nearly double their capital expenditure (capex) over the next five years, with total spending estimated to reach around US$ 800 billion by FY30, according to a recent analysis. This anticipated surge is expected to be fueled by strong revenue and profit growth, alongside infrastructure investments backed by supportive government policies.

In a note issued from Melbourne, S&P Global Ratings credit analyst Mr Neel Gopalakrishnan stated, “By our estimates, corporate capital spending will be about US$ 800 billion between fiscals 2026 and 2030, driven largely by infrastructure investments. We assume a further US$1 trillion in outlays between fiscals 2031 and 2035, driven by next-level investments and more research and development.” 

Mr Gopalakrishnan highlighted that India’s improving infrastructure, political stability, and lean corporate balance sheets are enabling large-scale expansion plans, which will broaden corporate revenue bases. He added that government initiatives promoting domestic self-sufficiency, exports, and supply-chain development are further stimulating private-sector investments. The agency’s baseline outlook suggests that India’s growth momentum will remain strong, with a deepening and more efficient industrial base and supply chain ecosystem.

Drawing a comparison with China, the report highlights that India’s upcoming capex cycle mirrors China’s corporate expansion in the 2000s, when reduced trade barriers, substantial foreign investment, and double-digit GDP growth spurred rapid industrial growth. Similarly, India’s policy-driven industrial push could trigger years of accelerated expansion and market gains.

Notably, China’s economy expanded at an average rate of over 10% during the 2000s, while S&P economists project India’s trend growth to average between 6.5% and 7%. 

However, unlike China’s earlier phase of expansion, Indian corporates are expected to operate under tighter financing conditions, which may limit excessive borrowing. S&P notes that this restraint could, in fact, be beneficial, preventing the kind of large debt buildup that several Chinese companies experienced.